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Malaysia - TAXES ACCOUNTING |
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Corporate tax
Tax rate for resident companies |
The general rate of the corporate tax is 28%. Exemptions and reductions are possible.
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Taxe rate on long-term capital gains |
In Malaysia, capital gains is taxed from 0% to 28%.
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System governing groups of companies and dividends paid by subsidiaries to their parent companies |
There is no withholding tax for dividends which are taxable only in the country of the actual beneficiary.
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Tax rate on branches |
The corporate tax is levied on branches as all the others companies.
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Income tax
Fiscal year |
The fiscal year begins on January 1-st and ends on December 31 of the same year.
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Income tax rate |
The progressive table of the income tax 2002 varies from 0% to 28%. The compulsory saving deducted at the source, owed by every employer and reserved for Employees Provident Fund is added to the income tax.
| From 0 to 2,500 ringgits | 0% | | From 2,501 to 5,000 ringgits | 1% | | From 5,001 to 10,000 ringgits | 3% | | From 10,001 to 20,000 ringgits | 3% | | From 20,001 to 35,000 ringgits | 7% | | From 35,001 to 50,000 ringgits | 13% | | From 50,001 to 70,000 ringgits | 19% | | From 70,001 to 100,000 ringgits | 24% | | From 100,001 to 150,000 ringgits | 27% | | From 150,001 to 250,000 ringgits | 27% | | Beyond 250,000 ringgits | 28% |
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Tax deductions or
other allowances |
Deductions attributed to taxpayers in Malaysia are the following:
-Annual personal fixed deductions of 5,000 ringgits.
-Deductions by couple of 3,000 ringgits.
-Deductions for single people of 800 ringgits
-Deduction of 110 ringgits for incomes equal or under 10,000 ringgits.
Non-residents do not have access to these tax deduction allowances in Malaysia. However the non-residents citizens in Malaysia have their own deductions and reductions.
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VAT rates
Standard rates |
There is no VAT, but a tax on sales (GTS). Normal rate is 10%. Rate is 25% for cigarettes and 20% for wine and beer.
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Reduced rates |
Rate is 5% on the sales of wood, food or building materials. Certain items are exempted (cycles, essential foodstuffs). A tax on services at the rate of 5% applies to certain goods (hotels, restaurants, insurances, telecommunication etc.)
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Other important taxes
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Name of tax |
Rate |
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Tax on royalties
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10%
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Land taxes
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Graded rate from 30% to 5%
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Tax on oil productions
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38%
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Accounting
Introduction
Malysian accounting rules aregoverned by the law, "The Compagnies Act" of 1965", under the responsability of the M.A.C.P.A.: " Malaysian Association of Certified Public Accountants".
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Obligations and publications
According to the law all companies have to publish the following recordings : shareholders' details, details concerning the members of the board of directors, details concerning the debt accounts of the company.
Public companies have also to publish their statutory accounts to the shareholders during the annual meeting.
Certification and auditing
Independent accountants must analyze the financial statements of the companies.
Professionals and representative organizations
Accountants must be members of the "Malaysian Institute of Accountants" and registered as "Pulic or Licensed Accountant".
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Last modified in
January 2003
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